A June 25, 2007 article in the Mississippi Business Journal called “Research explores effects of malpractice litigation on medical costs” concluded that the impact is estimated to be 2-15% higher costs in high litigation areas of the country. (http://goliath.ecnext.com/coms2/gi_0199-7036100/Research-explores-effects-of-malpractice.html)

Thanks for taking the time to share your thoughts!

To me the big picture ends up being, many people received a settlement, where the settlement isn’t just. Either it wasnt deserved or it wasn’t enough. The drug companies have to restructure/merge/ re-insure/ handle the added costs. We as consumers, taxpayers etc. absorb the astronomical cost of getting a new product to market. Many needed/probably safe products never get to market because of legislation. Even if they do, then they have to fight the onslaught of tort lawyers. In the end the only ones getting any benefit out of it all are the lawyers.

They do appear to be a good company, generally, and have produced many helpful drugs over the years.

But with regards to Vioxx, in my opinion, they are not really in danger of being “wiped out without any valid reason.” That assertion would mean they are in financial trouble and facing bankruptcy, layoffs, etc. because of Vioxx lawsuits, and that the evidence doesn’t warrant the charges asserted in the lawsuit(s).

According to Merck’s website the company made over $24 billion in sales last year with a net income of $3.2 billion, so I think they have a strong financial position.

As far as whether the evidence supports the lawsuits, Merck itself voluntarily removed Vioxx from the market based on results of its own studies and others.

In April The Journal of the American Medical Association (JAMA) included reports by independent researchers that Merck may have intentionally misled federal investigators in a campaign of deception in its zeal to get FDA approval for the drug Vioxx. The reports allege that:

- Merck gave the Food and Drug Administration a skewed accounting of deaths in a clinical trial of Vioxx; internal accounting suggested higher death rates, but the difference was attributed to the timing of death. When initially reporting mortality rates to the FDA the company only included those who had died during treatment and up to 2 weeks later (or up to 3 months later on a separate report). In reality more people died from side affects months later. The FDA eventually received all of this data, but prior knowledge may have resulted in avoidable injury and death.

- Merck was using what the JAMA authors call “ghostwriting” in order to make their research appear more credible when published in journals. The work of the company’s employees and contractors would appear to be the work of med school sicentists, which made Vioxx stand out in the saturated painkiller market. Yikes.

Facing over 26,000 lawsuits, in November Merck agreed to pay $4.85 billion to settle claims. This JAMA report was not expected to derail the settlement as it was not based on any new information that was not aready disclosed in previous court cases.

Considering that Merck made over $2 billion from Vioxx alone the year prior to taking it off the market, and the fact that the product was on the market for five years, the $4.85 billion they have set aside to settle these cases does not seem to be crippling to the company.

And given that Merck may have intentionally lied about clinical trial test results, and the fact that they were found liable for using deceptive marketing practices to promote Vioxx, I am not convinced that they are victims of overzealous or unreasonable lawsuits.

Perhaps the Vioxx case has prompted Merck to undertake better practices in both testing and promoting their drugs.

http://www.merck.com/newsroom/vioxx/
http://en.wikipedia.org/wiki/Merck_&_Co.
http://jama.ama-assn.org/cgi/content/full/299/15/1833
http://www.usatoday.com/news/health/2008-04-15-vioxx-drug-conflicts_N.htm
http://www.washingtonpost.com/wp-dyn/content/article/2008/04/15/AR2008041502086.html
http://www.reuters.com/article/governmentFilingsNews/idUSN1548250820080415

Wow, I wrote way too much here! Sorry - but it was a very interesting excercise. If anyone can give an example of a company that was unfairly driven out of business by unwarranted lawsuits, please post it so we can review.

You bring up some interesting discussion points. I’d like to know more about the “good products and companies are being wiped out without any valid reason.” Which products and companies are you referring to?

If you have any examples, I’d love to study them further. Please share. Thanks!